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Butler County faces deep budget cuts

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By Dave Greber, Staff Writer Updated 1:15 AM Tuesday, May 25, 2010

HAMILTON — Butler County commissioners must decide whether to close an estimated $4 million budget deficit through employee furloughs, layoffs or steep cuts, which some elected officials say could profoundly impact public services.

During a work session Monday, May 24, Budget and Management Director Pete Landrum laid out five possible scenarios to cover the shortfall. They include:

• Enacting a two-week furlough for all employees — including those from the bargaining unit if agreements could be reached — and a yet-to-be-defined percentage reduction for all departments.

• Reducing the Butler County sheriff’s budget $500,000 to $2 million, and an additional $2 million in reductions for all other departments.

• Enacting a two-week furlough and a 3.3 percent reduction to all departments’ discretionary spending.

• Two different equations that take into consideration the reduction of all departments’ discretionary spending by 6.5 percent or by a variable rate from 1.2 percent to 6.1 percent.

Commissioners agreed to continue the discussion at their next scheduled meeting, 9:30 a.m. Thursday, May 27.

But reductions must be made “sooner rather than later,” Landrum said. Should decisions be pushed back beyond his recommended date of June 1, Landrum and other department heads said the cuts would be felt more deeply at the department level.

“The sooner you make the cuts, the less pain we’re going to endure down the road,” said county Auditor Roger Reynolds.

Still, Reynolds cautioned commissioners that $3 million in cuts “is not going to get you out of your jam.”

“Furloughs are a Band-Aid. A Band-Aid to get you to a level of what you’re hoping is going to be a recovery of revenues,” Reynolds said.

“I just don’t see those revenues returning,” he said.

Commission looking to departments for cuts

County department heads have less than a month to make decisions regarding their individual budgets before commissioners enact sweeping cuts.

Although Budget and Management Director Pete Landrum told county commissioners Monday morning, May 24, they must act as soon as next week in order to reduce the county’s $4 million shortfall before it grows larger, commissioners made no move. Instead, they will provide department heads and some elected officials with the time they need to suggest cuts themselves, and quickly manage their own budgets before they feel the effects of furloughs, layoffs and possibly across-the-board cuts to discretionary spending.

Commissioners must approve one or a combination of the five scenarios presented Monday by Landrum in the coming weeks. Those scenarios are just options commissioners could take to reduce the budget; they could agree, combine options or come up with a completely different set on their own, Landrum said.

Earlier this month, the county’s finance department tallied the looming deficit — not limited to a $2 million gap in prison boarding at the Butler County Jail, a $377,409 drop in property tax revenues and an unexpected $700,000 payment to the Miami Conservancy District following improperly collected funds.

Some say the county knew the shortfall was coming well in advance of last week’s news of the same, including an earlier meeting with Butler County Sheriff Richard K. Jones to discuss a drop in prison revenues and similar discussions in February and March with Reynolds about declines in property taxes.

“This has been discussed for over three months,” Jones said Monday. “They still don’t have a plan. And the sheriff’s office has already cut 63 employees in the past 18 months. It has already affected the safety of the public, and we’ll wait and see.”

Jones also said he never promised to make up the difference if prisoner boarding revenues fell short.

“What I said is I would manage my budget with the money that I have, and I have.”

The sheriff estimated that his prisoner boarding revenues have saved the county $10 to $12 million during the past five years.

“My budget has actually funded the entire county,” he said. “It has kept them really in business.”

The stall is now necessitating quick action on behalf of commissioners, who must make a decision on cuts soon, or face “an even deeper cut” and a potentially lower bond rating, making borrowing money in the future more costly. County officials are heading to Chicago in July to have the local bond rating evaluated.

Some department heads, like Domestic Relations Court Judge Sharon Kennedy, requested commissioners provide them more time to determine — on an individual basis — where cuts can be made instead of enacting furloughs or across-the-board cuts.

“We have laid off staff, we have laid off hearing officers.” Kennedy said. “We have done everything we can to meet what you want us to do.

“I would strongly consider those that didn’t make the 11 percent cuts (last year) … You look at them first.”

There also was discussion regarding what commissioners and others consider discretionary and non discretionary spending.

Non discretionary spending includes many areas mandated by the state and others not currently being considered by the county, such as elected official salaries, fees for attorneys, contracts for county maintenance, unemployment and workers compensation payments, debt payments, the board of elections and veterans services departments and some aspects of Juvenile Court.

However, the longer commissioners wait, county Finance Director Bob Lowery said, the number of items considered “non discretionary” will shrink and the budget deficit will grow.

Staff Writer Josh Sweigart contributed to this report.

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